People with Covered California plans are discriminated against by some providers and insurance companies.
Both the health plans and the doctors practice subtle and overt forms of discrimination against people with Covered California health insurance. Some of the discrimination is legally built into the health plans. Other discrimination takes place in the form of denying health care services because the prospective patient has a Covered California health plan.
Physician discrimination
The most common complaint I hear is that people have been denied doctor appointments because they have their health insurance through Covered California. A common refrain from the doctor’s office receptionist is that the physician only accepts off-exchange individual and family plan health insurance. The inference is that the exact same health plan purchased directly from the insurance company (aka off-exchange) is somehow inherently better. Conversely, members of health plans that are purchased through Covered California (on-exchange) are less worthy of health care services.
Provider networks the same on or off exchange
If the individual and family plans purchased off the exchange had separate provider networks then the excuse of not accepting Covered California member would be valid*. However, Anthem Blue Cross and Blue Shield of California claim their individual and family provider networks are the same for on and off exchange health plans. Health Net has in the past had separate on and off exchange networks for some of their health plans. But in general, the individual and family plan provider network is the same whether the health plan is bought through the carrier or Covered California.
*To be fair, some consumers have mistakenly determined that a physician is in-network through their health plan’s provider search tool. Unfortunately, the online doctor search functions can be confusing because the health plans have a variety of different networks. If the wrong network is selected, a doctor may show as in-network when really he or she is not.
Overt discrimination against Covered California members
Aside from gross ignorance on the part of the office staff or doctor, which cannot entirely be ruled out as a possibility, why would a doctor NOT want to accept patient that has a Covered California health plan? If an individual or family enrolls through Covered California they are most likely receiving premium assistance tax credits to reduce their monthly health insurance premium. This indicates to some providers that the prospective patient may not have enough money to pay for services. For Bronze and Silver plans there is a deductible that must be met before the health plan will share in any of the costs. It could be that some providers fear not being able to collect for services since the patient must pay the full amount before the deductible is met.
Redlining Covered California health insurance
If this is the case, then doctors who refuse to accept health plans issued through Covered California are practicing a subtle form of income discrimination. This income discrimination is very similar to the practice of redlining where banks and insurance companies would refuse to loans and policies to families living in certain areas. The assumption is that people with lower incomes and liquid assets are at a higher risk of default or nonpayment.
Bronze is just as good as Platinum
Another excuse heard by Covered California members is that the doctor only accepts certain health plans of a specific metal tier level. A client of mine just filed a complaint with several different agencies documenting how she attempted make a doctor’s appoint only to be told that the doctor only accepted Platinum plans. The logic was that Platinum offers better protection against expensive surgery. My client countered that all plans have a maximum out-of-pocket amount and she would never have to pay the full amount of any health care services beyond the maximum amount which is no more than $6,500.
Are doctor worried about getting paid by Covered California members?
In reality, the $0 deductible of the Platinum plan protects the doctor from having to collect on physician fees the patient must shoulder on either a Bronze or Silver plan. By excluding services for Bronze and Silver plans the doctor is discriminating in favor of receiving at least the health plans coinsurance percentage or either 80% or 90%. Of course, this in turn makes me wonder if physicians are ordering more high cost services for Gold and Platinum plans that have no deductible versus the Bronze and Silver plans which have deductibles. Are Bronze and Silver plan members having health care delayed by physicians who fear not being paid?
Those people
Perhaps it’s not the concern of getting paid but just the sight of the client. Covered California health plans are a tremendous equalizer between the rich and poor in terms of health insurance. The very wealthy can have the same Platinum plan as those with moderate incomes. But does the doctor in Beverly Hills really want people from outside the community sitting in his or her waiting room? These new people could make his existing patients uncomfortable. Consequently, to filter those people from the neighborhoods with low net worth balance sheets, a doctor may instruct his office staff to refuse Covered California health plans, which are subsidized, and only accept off-exchange plan members who must pay the full premium amount.
Deductibles discriminate against consumers
Another form of discrimination comes in the form of the health insurance deductible itself. The higher the deductible, the lower the premium because the health plan member shoulders a greater share of the health insurance costs. Insurance companies understand that people with moderate to low incomes will be attracted to lower rates. People with health challenges and low income are drawn to the lower premiums of the Bronze and Silver plans. Fortunately, the Enhanced Silver plans with reduce deductibles and cost sharing help lower income families afford health care. But the reality is that all standard benefit design plans have an annual maximum out-of-pocket limit. In 2016, the Bronze plan will be $6,500, Silver and Gold will be $6,250, and Platinum will be $4,000 for in-network services. After the maximum out-of-pocket amount is met for the calendar year, the health plan picks up all the covered benefit costs.
Health plans attempt to steer consumers
But some health plans employ other tactics to subtly discriminate against people that might generate health care claims. Some health plans have paid a reduced agent commission, or in some cases no commission at all, for Silver, Gold and Platinum plans. Cigna will not pay agents any commission for 2016 enrollments in their Silver, Gold or Platinum plans. Western Health Advantage will pay a 5% commission rate to agents for plans sold off the exchange but only $22 per person per month for plans sold through Covered California. In the past, carriers have offered bonus for Bronze plan enrollments.
Rich benefit plans discouraged
The intent of these different compensation schemes by the carriers is to influence agents to steer clients to plans that will limit their claims liability. In other words, they want agents to promote high deductible plans and discourage the enrollment in Gold and Platinum plans that generally lead to the carrier paying more in health care expense cost sharing on the member’s behalf.
Covered California plans are no different
Individuals and families who enroll in Covered California health plans should receive the same care and attention as a household who enrolls in an off-exchange plan. To discriminate against Covered California members is ignorant and wrong. The health plans purchased through Covered California as the same plans and networks that are offered directly from the carriers. Only education and potentially new regulations will stop the denial of services to Covered California consumers.
Have beef with a doctor or health plan?
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You can also file a complaint with the Department of Managed Health Care who regulates most of the health plans offered through Covered California with the exception of some PPOs.